Change in futures price will lead to a margin call

Assignment Help Finance Basics
Reference no: EM132540666

Suppose you enter into a long futures contracts to buy crude oil for $31.50 per barrel. The size of a contract is 10,000 barrels. The initial margin is $8,000 and the maintenance margin is $ 6,000. What change in the futures price will lead to a margin call? Please explain your answer.

Reference no: EM132540666

Questions Cloud

Estimate of gg intrinsic value per share : Assuming its current market price is equal to its intrinsic value, what do you expect to happen to its price over the next year
What is the initial markup in dollars : What is the initial markup in dollars? What is the initial markup%? The women's wear department plans the following figures for the fall season
Prepare journal entries on the books of aa company : The entity has the option to purchase the machine on January1, 2030 by paying P200,000. Prepare Journal Entries on the books of AA Company
What the term relevant range in accounting means : In an income statement prepared as an internal report using the direct costing method, fixed selling and administrative expenses would
Change in futures price will lead to a margin call : What change in the futures price will lead to a margin call? Please explain your answer.
Compute basic and diluted earnings per share : Share warrants outstanding to buy 16,000 ordinary shares at sh.20 per share. Compute basic and diluted earnings per share
Where do you think most school aged children would land : In your experience, how do the current approaches to schooling, parenting and children's activities fair in terms of developing a child's morality?
What is the npv of investment : If the steel company has a cost of capital of? 6%, what is the NPV of this? investment?
Computer Fraud and Abuse Act : Under today's interpretation of the Computer Fraud and Abuse Act (CFAA), if executives in Florida and North Carolina

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd